Diabetes increases the risks of maternal, fetal, and neonatal complications from pregnancy. Tight glycemic control during pregnancy reduces these risks but is difficult to achieve. Major depression is present in approximately 25 percent of diabetic women and is associated with significant deterioration in glycemic control. There has been no study in diabetic or nondiabetic subjects of depression treatment during pregnancy, and the effects of depression treatment on obstetric outcomes remain unknown. Recently, we showed that cognitive behavior therapy (CBT) was an effective nonpharmacologic treatment for depression in diabetes that produced durable improvements in glycemic control. In this study we plan to treat major depression in pregnant diabetic women with CBT and determine its effects on depression, glycemic control, and maternal and neonatal outcomes. We also plan to assess the relationship of diabetes during pregnancy and postpartum depression to neuropsychological development of the infants. 150 pregnant diabetic women will be recruited for study: 100 with and 50 without major depression. The nondepressed subjects function only as a comparison group in some of the statistical analyses. All subjects will be assessed serially during the 2nd and 3rd trimesters and the 1 year postpartum period while receiving the usual degree of intensive medical care for the diabetic pregnancy. Depressed patients will be assigned randomly to treatment with individual CBT (n =50) or supportive counseling (n =50). The pregnancy care team is informed of the depression status of all subjects and advised to give usual care for depression. The design blinds the pregnancy care team to treatment assignment, controls for nonspecific effects of attention and the influence of enhanced diabetes control on mood, provides a comparison group likely to remain depression free during gestation and the postpartum period, and is sensitive to human subject issues. We hypothesize that CBT will be superior to supportive counseling in terms of improving depression and glycemic control, and that the treatment-related improvements in glycemic control will reduce the adverse effects of diabetes in pregnancy, including c-section, macrosomia, neonatal hypoglycemia, and fetal hyperinsulinemia. We also expect that by improving glycemic control during pregnancy and reducing the risk of postpartum depression CBT will improve neuropsychological development in the offspring. The findings should demonstrate the relevance of depression treatment to maternal and neonatal outcomes of diabetic pregnancies and translate directly to the management of patients living with diabetes.